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Bankruptcy Law

Madoff Trustee Settles Litigation with So-Called Feeder Fund

Posted May 18, 2011 1:59 PM CDT
By Stephanie Francis Ward

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The trustee liquidating Bernie Madoff’s firm agreed to not pursue $212 million from two bankrupt funds related to the Fairfield Greenwich Group, the biggest so-called feeder fund in the alleged Ponzi scheme, Bloomberg News reports.

As part of the settlement with the trustee, both funds reduced their claims against the Madoff bankruptcy estate.

“The agreements greatly further the interests of the customers” of Madoff, trustee Irving Picard wrote in a filing today in the Southern District of New York U.S. Bankruptcy Court.

Picard, a Baker & Hostetler partner, earlier this month dropped efforts to collect $3.8 billion from three offshore Fairfield funds that allegedly withdrew from the Madoff firm, Bloomberg News reports. Like the more recent agreement, the offshore fund agreed to drop its claims on the Madoff estate.

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